Consumer Rights Bill

Baroness Primarolo Excerpts

Monday 16th June 2014 Commons Chamber

[Stella Creasy]

I add my congratulations, Madam Deputy Speaker, to those of other hon. Members. Indeed, there is nothing like a dame. [Interruption.] Come on, somebody had to say it.

I do not know where to start with what the Minister has just set out. Loophole after loophole seems to be being built into this legislation, with the proviso that someone else will pick up the pieces. The Minister hopes that it will be various other regulators, but it is clearly the consumer who will be ripped off instead. I can see from the face of the hon. Member for Shipley (Philip Davies) that he too was disappointed, and I fear that it is time rather than intent that will mean we cannot make much progress today. I urge the Minister to watch the John Oliver video that is going round the interweb, if only to understand the real concern about net neutrality. I certainly hope that our colleagues in the other place will make some progress on this. The idea that at point of sale we can defend such a fundamental principle as free speech does not cut the mustard.

On debt management companies and log book loans, the Minister refers to the Financial Conduct Authority, leaving it to pick up the pieces from legislation that is antiquated and outdated, which at some unspecified time the Law Commission may look into. It is not good enough. We know that millions of people are in debt to such legal loan sharks. We know that the debt management industry is profiting as debt in this country goes up, not down. The right thing to do would be to get the consumer credit landscape to work for that problem, rather than to ask somebody else to deal with it, whether that is the Financial Conduct Authority or the Law Commission.

Again, this is the Consumer Rights Bill. A bill of sale is a consumer contract. There is no justification in the modern world for leaving them in place. The Minister is fond of saying that the Labour Government had 13 years to do something about it. That Government were on the verge of outlawing bill of sale agreements. I hope the Minister will change her mind.

The amendment that we must press to a vote is amendment 1 for those Members who were not here earlier to hear about estate agents charging both the buyer and the seller a fee. The Minister accepts that there is a concern. We are talking about fees of thousands of pounds for our constituents to buy a property—a fee that distorts the price that a seller will get. Yet again, the Minister calls for a loophole to be written in and calls for the property ombudsman to monitor the situation, when it is clearly a conflict of interest for an estate agent to act for both the buyer and the seller at the same time.

Our constituents will rightly ask us what we are doing when we see these clear breaches of contract law taking place. Simply saying, as the Minister does, “Well, we’re going to monitor the number of complaints” is a green light for estate agents to undertake such practices. That is compounded by the fact that all estate agents in most of our constituencies are monitored from a rural Welsh constituency by Powys county council. It cannot understand how these half a million people are behaving, or how we reached the stage when a fee of thousands of pounds could be applied. There is complacency about a clear rip-off that our constituents are facing. [Interruption.]

The Minister of State, Department for Work and Pensions, the right hon. Member for Hemel Hempstead (Mike Penning) says, “Get on with it.” There are people in my constituency paying £6,000 or £7,000 as a fee. The Minister says we had 13 years. The present Government have had four years. We have given an example of how they could do something about it. The Government are failing to make progress, yet again, and all our constituents miss out. I fear for the Minister when one of his constituents comes to him with one of those contracts, under which they are paying £6,000 or £7,000 to an estate agent as a fee to buy a property under sale of tender, and he justifies doing nothing about it.

This Bill is an opportunity to make progress. We on the Opposition Benches—[Interruption.] The Minister comments that I was in diapers when he became an MP, but I am old enough to recognise when there is a rip-off to be dealt with—

[Madam Deputy Speaker (Dame Dawn Primarolo)]

Order. Will the hon. Lady sit down, please. Minister, I hope you did not say that. You have just entered the Chamber and you have been shouting since you sat down. It is not in order to speak to any hon. Member at the Dispatch Box. Members need to calm down a bit, please.

[Stella Creasy]

Thank you, Madam Deputy Speaker. I was about to wind up.

I know that house buying arouses a lot of passion, but it arouses even more passion when people get ripped off by an estate agent. It is clear that the Government do not support an amendment that would make progress in tackling the problem, which occurs across the country. They are all noise and no action. The Opposition want to see action on estate agents who are ripping people off. I hope Members on the Government Benches who have seen it in their constituency and who fear the impact that it is having on the price of houses will join us in the Lobby in voting for amendment 1.

--- Later in debate ---

[Diana Johnson (Kingston upon Hull North) (Lab)]

On a point of order, Madam Deputy Speaker. At 10.50 this morning a reporter from The Sun, Tom Newton Dunn, tweeted:

“ISIS will be made a banned terrorist organisation in the UK by the Home Secretary today.”

That was before the Order had been laid before Parliament and before the shadow Home Secretary and the Chair of the Home Affairs Committee had been notified of the Government’s intention, which is the normal procedure. As these matters involve national security, and obviously the whole House takes them very seriously, I wonder whether you feel that that chain of events was in order.

[Madam Deputy Speaker (Dame Dawn Primarolo)]

I am grateful to the hon. Lady for giving me notice of her intention to raise a point of order. Strictly speaking, it is not a point of order for today’s debate. However, I reiterate that Mr Speaker has made it clear to the House a number of times that any business that is to be dealt with in this House should be notified to Members of Parliament first. I see that the Government Chief Whip is in his place and am sure that he will ensure that no discourtesy to the House was intended and that he will reaffirm, and ensure that Ministers stick to, Mr Speaker’s clear preference, which is that this House should always be told first.

Third Reading

--- Later in debate ---

[Jim Shannon (Strangford) (DUP)]

On a point of order, Madam Deputy Speaker. I stand to be corrected, but I thought that those who wanted to speak on Third Reading did so before the shadow spokesperson. Am I wrong?

[Madam Deputy Speaker (Dame Dawn Primarolo)]

You are wrong, yes. The Minister opens Third Reading, and the Opposition Front Bencher responds; we then hear from other participants. If we have enough time, and it is relevant to do so, we then hear the wind-ups. Do not worry—I will not forget you.

[Stella Creasy]

I am on tenterhooks to hear what the hon. Member for Strangford (Jim Shannon) has to say. Thanks to our consideration of the Bill, I am aware of my right to a return and a repeat performance if I do not think the skill and service is satisfactory; he should be aware of that.

Whereas poppadoms are not to be shared, I have feedback—the breakfast of champions, as it was once called—to share on the Bill and whether it works. Does it pass the Ronseal test—does it do what it says on the tin? The Bill says that it is there to

“Amend the law relating to the rights of consumers and protection of their interests”.

Certainly, as I hope I have just displayed, during our consideration of the Bill we learned what our rights will be: we will have the right to have legislation written with reasonable care and skill, and provided at a reasonable time and price to us all. The rights of our consumers—our constituents—to remedy and redress when they feel that we are not providing that are somewhat limited. That is why they rely on us as Opposition Members to hold the Government to account. However, our role is not simply to intervene, or identify injustice as it affects our constituents, but to act on it. That is what we have tried to do in proceedings on the Bill.

At the heart of this is the question of rights. Does the Bill give consumers the rights that they need if they are to act for themselves? That has been our central concern. In that, we were influenced by the words of the Mayor of London—who knows what else he will be in future?—who once said:

“The dreadful truth is that when people come to see their MP, they have run out of better ideas.”

If the Bill had been well written, it would have given people rights that would have meant that they did not have to come to us, their MPs, with such regularity with all the stories of consumer detriment that we heard about during proceedings on the Bill. A really robust Consumer Rights Bill would empower the British public, giving them the rights and the confidence that they need to be able to choose the goods and services that they desire. Under that test, the public could demand a refund on the Bill, for as we saw only today, loophole after loophole remains, and it is consumers who will have to pay the price.

The Minister talks of a consumer toolkit, but that toolkit has a blunt Stanley knife and a broken hammer in it. Time and again, throughout consideration of the Bill, the Government have failed to grasp how giving the public access to the information, advocacy and redress that they need to shape services to meet desired outcomes would be a better idea, in terms of dealing with markets and services when the odds are stacked against them. Indeed, one of the things we have not done so far is set out what a market that is not working looks like or what the problems are.

In setting out our concerns on Third Reading, let me be clear about where our amendments came from. We need to recognise that a market is not working when information is not flowing freely between actors, whether they be consumers or businesses, such that they are not able to make informed choices. A market is not working when companies use their advantage to crowd out new competitors, collude on prices or, indeed, create a monopoly. Such a market may also result in unintended consequences because of the behaviour of others. The result is always the same: consumers miss out when markets do not work.

We have attempted to amend the Bill in this House and I am sure my colleagues in the other place will continue to do so in order to address some of those problems. Many markets in the UK do not meet the metrics of success whereby information flows freely and there is competition on creativity and innovation—not exploitation of captured consumers who have little option but to pay over the odds—and where the reasonable care and skill test can truly be applied.

At every stage of this Bill, colleagues throughout the House have raised issues that reflect those concerns about markets, including ticket touting, rip-off estate agent fees, copycat websites, logbook loans, product recall and even net neutrality. Every example involved scams and sharp practices, yet this Bill will not make progress in protecting the interests of consumers. As we have consistently been told by the Minister, that is outside the scope of the Bill and a matter for the mysterious implementation group, whose inner workings are still a secret to many of us.

At every single turn, the Minister has claimed that someone or something else can act. She has said that so often that we think it would be worth renaming the Bill the “computer says no” Bill. That may be an effective phrase for coalition government, but it is also a recipe to rip off consumers.

Despite the Minister’s best efforts to tell us, “There’s nothing to see here,” it has become clear during the course of our work that this Bill reaches far beyond how easy it is for any of us to return a jumper with a hole in it. We know there is much more to consider with regard to how the Bill will impact on the public sector. The Minister has still not clarified which services are covered, preferring to tell us only that most NHS care, state-funded education and law enforcement services are not covered. Of course, given that tuition fees, personal care payments and child care vouchers are covered, it would seem that this Bill is less a case of, “computer says no,” and more one of, “Yeah, but no, but yeah.” It has certainly felt like we have been asking questions of the sphinx at times, because we have had to find the right question in order to get the right answer for our constituents. The risk is that the Bill will devour all those who fail to solve its riddle.

In fear of yet again being cast into the pit of despair, may I again ask the Minister to clarify, with a yes or no answer, whether the following contracts are covered? Is the BBC licence fee covered? Given the recent comments of the Secretary of State for Culture, Media and Sport, surely that is an apposite and important point to clarify. Before the Bill goes to the other place, it would be incredibly helpful if the Minister could clarify whether it also covers parking permits and prescriptions.

Understanding this minefield and the impact it will have on consumers of public services now falls to our colleagues in the Lords. Given the evidence that we are a nation of silent sufferers—in particular, many elderly users of care services fear that they cannot complain—the fact the Minister is devolving getting this right to the Cabinet Office, as she declared on the first day on Report, simply will not stand. We put her on notice that we will not let public service users experience a two-tier system because she could not define what clause 2 does.

The Minister may sigh again and point to the long gestation of this Bill, including the Labour Government’s original 2009 White Paper on a new deal for consumers. We generally agree that there is a need to update the fundamental principles enshrined in the Sale of Goods Act 1979. That was published shortly after I was born—which, as the Minister of State, Department for Work and Pensions, the right hon. Member for Hemel Hempstead (Mike Penning), who is no longer in his place, would say, was, “A long time ago.”

It is certainly time for an update, which is why we will not oppose this Bill’s Third Reading, but it is also time for clarity, which the Bill does not yet deliver. I hope the Minister will not think it churlish of me to say that we welcome the fact that some of our proposals have been considered and, indeed, adopted. When the issue of speedier refunds was first raised, there seemed little hope of progress, but having had our call for a time limit of 30 days batted away, we were delighted with the Government’s amendment making 14 days the cut-off for consumers to get their money back. There have also been announcements on copycat websites and letting agent fees as the Bill has progressed. Those things have been encouraging and we wait with bated breath to see on what else the Minister will come full circle.

Like the Minister, I want to put on record my gratitude to the members of the Business, Innovation and Skills Committee and the members of the Bill Committee for playing their part. Having received during the course of our deliberations a marriage proposal, hair-dressing advice, loft-conversion concerns and a lecture in socialist ideology, as well as the opportunity to hear passionate debates on issues such as electrical safety, public service reform and data protection, I believe we have given much for our colleagues in the other place to ruminate. I also want to put on record my personal thanks to the Clerks of the Public Bill Office, who have been kind and generous with their time in drafting amendments and new clauses. However mean the Minister may wish to be about those amendments and new clauses, we certainly think they have made a difference.

As the Bill goes to the other place, let me say again what a missed opportunity it has been. Major consumer reforms come along very rarely—as the Minister of State, Department for Work and Pensions, the right hon. Member for Hemel Hempstead, would point out, I am now of a certain age. I fear there is little hope of a return, a refund or a repeat performance for our constituents if we get this wrong. They will not want to wait another 35 years. I have every confidence that the noble Lords will continue our work on issues such as letting agent fees, debt management, access to data, advocacy, trading standards and redress, and that they will also finally pin down the magicians of the implementation group and the mysterious work of ombudsman services.

Britain can do better. We will not oppose the Bill, but instead send it to the other place and ask it to continue our efforts to improve this Bill so that it can live up to the bold sales pitch of protecting consumer interests. If that does not happen, I for one will encourage the British public to exercise their right to a return at the ballot box in 2015 and finally cast out a Government who are clearly not fit for purpose.